How Technology Is Changing Sales Structure

Technology is also changing the structure of sales organizations. The customer today is self-educated and a large part of the buyer journey now takes place online. Most of the time, a customer will have made up their mind about the product they will buy before even talking to any sales representative.

This has had a profound effect on sales department structure over the years. The lines are blurring between sales reps selling remotely (inside sales) and the outside sales roles (reps who primarily sell face-to-face).

Outside sales reps now spend almost half of their time (45.4%) selling remotely (an increase of 89.2% from 2013). In the US, 47% of sales professionals are inside sales, while outside sales represent 52% of the workforce.

This trend is different in Europe, with companies reporting 37.1% of their sales force as inside sellers and 62.9% as outside sellers.

This shows us that the European sales organization is taking longer to adjust for the market changes. This has some worrying implications. Potentially European companies are simply having their existing outside sales reps sell like inside sales reps but at what cost? Alternatively, we are really seeing the rise of the hybrid seller. We are currently researching this further

The global numbers will most likely continue towards equilibrium. Companies report the ideal split of inside and outside sales should be nearly 50/50.

Sales Compensation

As far as sales compensation goes, sales professionals still earn a large part of their income as variable revenue (with a 47/53 split for the base and variable income). I expect this model will continue to be popular for the future.

Sales is inherently a competitive field, and variable rewards based on performance are not going anywhere anytime soon.

The study revealed the average base salary for inside sales account executives is $42,833 with an average on-target-earnings (OTE) of $96,299.,In the US, OTE tends to be higher ($111,170) than in Europe (£73,219 or $98,058).

The Future of Sales Is Here

The future of sales is here, and the State of Sales report from XANT gives us a good view of what it looks like.

A more empowered and impatient customer means we need to work faster and be more efficient than ever. We need to service them instantly and gain their trust before they are off to talk to the competition.

This is why the rise of AI-powered sales acceleration platforms can only be good news.

Recent research presented at the World Economic Forum in Davos shows that companies or countries which embrace Artificial Intelligence technology can see revenue rise around 40 percent by 2020. Forrester believes that those companies that do not embrace AI will be displaced to the tune of $1.2 trillion per year.

While I’m not expecting AI to ever replace sales reps, I do expect that intelligent systems will help us sell more, sell smarter and sell faster. AI can show you instantly which are your hottest leads, when you should contact them and whether you should use a phone call, email or voicemail.

We can eliminate valuable time spent researching and spend more time selling.

I would advise all sales leaders to read the executive summary of the State of Sales 2017 research. It’s a real eye opener.

If you’d like to get access to the executive summary of this study, please go here:

Part 1 and part 2 of this article were originally published on LinkedIn.

They’re the engine that puts fuel in your sales pipeline – day in and day out.

This is why it is crucial to understand and know the structure of sales development, the specific activities for pipeline generation and above all, the people and what they do to guarantee the health of your pipeline

In an effort to understand the sales development role, XANT Labs commissioned a study in partnership with SalesForLife, BridgeGroup, Drift, Datanyze, OneMob, and Tenbound.

The study includes 900 companies and reviews the four elements of a successful sales development team: structure, systems, people and pipeline.

The findings were very telling of where we are today with SDR and where there is a gap in their activity.

Inside vs Outside Sales Development

The lines between inside sales and outside sales keep blurring, shows the research. More and more customers are empowered and contacting companies, rather than waiting to be contacted.

According to the study, there are an estimated 677,479 sales development reps in the U.S.

About 17 percent of sales development reps are inbound sales, while 28% are outbound sales. More than half – 54 percent self-report as doing both inside and outside sales.

Sales Technology Systems

Sales technology has become an extremely important part of every sales development team’s makeup and organization. Companies spend overall on sales development technology is $1.4 billion. This is just a small part of the overall 14.9 billion spent in total on sales technology industry.

In the research, companies reported the average annual spend on sales technology was $3,894 per rep/year.

That’s around 17% less than what they spend on account executives, who seem to get the lion’s share of the budget. Companies have around one sales development rep for every three account executives.

The $3,894 covers an average of 4.8 categories of sales tools per rep. The most popular categories were (excluding CRM):

• Social prospecting (30.3%)
• Data/list services (21.6%)
• Email engagement (20.7%)
• Phone (16.0%)
• Sales Cadence (12.8%)
• Lead/Account Scoring (10.7%)

Sales Development – The People

Companies need to pay market value to retain their top people. The Sales of Sales Development offers a benchmark on sales development compensation.

According to the XANT research, the average base salary for sales development reps is $41,675, with an average on-target-earnings (OTE) of &80,774. While earnings will vary based on the region, there is one aspect which remains constant – and that is variable income.

A section of sales representatives’ incomes are variable to ensure performance and quota attainment. The mix between base and variable was a 60/40 split, with 59.7% for the base and 40.03% for the variable.

Pipeline Generation Activities

As far activities go, sales development reps are certainly not idle – they place dozens of calls and send a host of emails and voicemails every day to generate qualified pipeline.

Sales development reps did an average of 94.4 daily activities including an average of 36.2 emails (38.4%), 35.9 phone calls (38.0%), 15.3 voicemail messages (16.2%), and 7.0 social media touches (7.4%).

They reps had an average of 14.1 meaningful conversations a day, which was around 15 percent of their daily activities.

For all their effort, not all sales development reps are able to reach 100% of their quota.

Why Sales Development Reps Only Report 63% Quota Attainment

The quota for pipeline generated was $658,692, however companies report only 63.5% quota attainment for SDRs.

The report is an eye-opener for sales leaders interested in increasing their team’s performance.

For high-performing teams, the combination of sales training, self-motivated sales reps and AI-recommended lead prioritization can mean the difference between failure and success.

Sales leaders need to see this as an opportunity to make changes – and act on it. We need to enable sales reps to work smarter, rather than harder.

You can read the executive summary of the State of Sales Development 2017 here.

How The Sales Industry is Changing

The recent XANT research, “State of Sales 2017” polled 1,151 companies. The study paints a clear picture of the sales structure, sales technology systems and sales people and compensation today.

The study shows 47 percent of sales reps working as outside sales. Around 43 percent are inside sales representatives, while sales development representatives make up 10 percent of this workforce.

Sales Technology Spend is Increasing

Companies are spending more today on the sales technology stack than they did three years ago, shows the study. Companies reported that, on average, they spend $4,581 on sales technology per rep each year. Compared to 2014, there has been a 22 percent increase in technology spend.

Smart sales systems, powered by machine learning technology, have proven they can help sales professionals sell more and sell smartly.

Users of the XANT platform can see a lift in their results by up to 30 percent.

You can download the executive summary of the State of Sales study:

Or you can check out the at-a glance infographic.

The “State of Sales 2017” study covers 1,151 companies in U.S. and 28 countries in Europe and shows that companies are doing to accelerate sales.

The combined research of all countries shows an average of 60.9% of all sales account executives are attaining quota, with the U.S. attaining an average of 58.4% and Europe averaging 65.0%.

European Sales Reps are 11.3% Better at Attaining Quota Than U.S.

Inside sales is growing rapidly in Europe, along with as overall sales productivity. While U.S. reps are using more basic activities, their European counterparts are posting more meaningful stats in areas that relate to actual sales conversations and close ratios.

The research results are showing that the U.S. is doing less effective prospecting work that isn’t showing up in actual sales progress when compared against Europe. Why?

U.S. sales reps are expanding their prospecting activities to include email, phone, voicemail, and social media far more than their Europe counterparts with 97.3 average activities per day in the U.S. versus 86.5 for Europe (11.1% more.).

However, there are The State of Sales study shows there’s something sales reps in Europe are doing to improve their quota attainment rates.

Phone Call versus Email – We Have a Winner

Sales representatives in Europe focus quite a bit more on using the phone than email. About 35.7 percent of their activities are phone calls versus 30.9 percent of the US sales activities.

Phone calls result in much stronger sales conversations than email. European sales reps have 12.2 meaningful conversations per day, versus 10.6 for the U.S. – a whopping increase of 15.1%.

This means they are having richer conversations, which seem to be assisting in the closure of more sales.

The other obvious element of the sale that may be a factor would be sales skills in bringing closure to the sale, though it was not an element of this study.

Download the State of Sales 2017 Study

The study was done in partnership with the American Association of Inside Sales Professionals (AA-ISP), as well as Top Sales World, and the Association of Professional Sales (APS) who contributed access to a much-expanded database of companies in Europe.

You can find the full executive summary is available here.

This research report is incredibly telling on the state of sales today. I’ll discuss these results and other research in my columns on Forbes Magazine.

According to the report, the gap is closing between field sales reps and inside reps that sell remotely, shows the Utah Business Magazine article.

“The results of this study should be eye opening for most sales organizations, especially within enterprises that often wonder if the extra investment in sales technologies is worth it—and it undoubtedly is,” said Dave Elkington, CEO of XANT. “Of the many takeaways here, one is that enterprise organizations, which tend to be higher cost—due to higher salaries, cost of travel and personal relationships with customers—will only make it in today’s tightening enterprise B2B sales environment if they improve their efficiency by adopting sales technologies.”

The survey of 1,151 companies across 28 countries was created in partnership with the American Association of Inside Sales Professionals (AA-ISP), Top Sales World, and the Association of Professional Sales (APS).

The report shows some repeatable patterns that drive high performance. You can download the State of Sales report for free on XANT.

Sales Technology Systems of the Future

Sales technology has become an extremely important part of every sales team’s makeup and organization, shows the study. Companies reported that, on average, they spend $4,581 on sales technology each year. The sum covers an average of 5.8 sales tools, and companies pay on average $66 per tool per month – in subscription-type payments.

The typical sales stack for a company is using the following six tools:

• CRM
• Social prospecting
• Presentations
• Pipeline management
• Data/list services
• Email engagement

Companies Will Invest More in Sales Technology

Technology spend per rep varies significantly by size of company – with large companies lagging behind small and medium companies on annual spend per rep.

Interestingly, large, medium and small companies spend similar amounts on sales technology in relation to their reps’ salaries (5.8%).  Expert are expecting this percentage to increase across the board.

Currently the average proportion of budget on sales technology in relation to sales rep’s salaries is 5.8%. Next year, this will reach 6.5%.

Download the State of Sales 2017 Report

The State of Sales 2017 Report was created by XANT Labs in partnership with the American Association of Inside Sales Professionals (AA-ISP), Top Sales World, and the Association of Professional Sales (APS).

The study surveys 1,151 companies across the focus areas of structure, systems, and people to determine what they do to win more deals and increase their revenue. In addition, the study examined the sales market in which these companies operate and completed a benchmarking exercise.

To download the State of Sales 2017 study, click here:

The State of Sales report studied 1,151 companies to find what they do to win sales and close more deals. In addition, the study examined the sales market in which these companies operate and completed a benchmarking exercise.

The study is built around three major categories – structure, systems and people. It offers a unique perspective on how sales professionals run their companies to produce the best possible results.

Sales Organization Structure

Often, outside sales and inside sales appear to be at odds with one another. Inside sales offers a leaner and more automated approach. Outside sales capitalizes on the in-person interaction and the power of face-to-face communication. Instead of trying to find “which is better,” the study details industry trends that dictate the structure of sales organizations in 2017.

Across the market, companies reported that 44.4% of their sales teams were inside sales while 55.6% were outside sales. In addition, the average number of sales related functions per company was 3.9.

Large organizations (revenue > $500M) are dominated by field sales reps (71.2%). They also capitalize more than any other size organization on the benefit of the channel program (69.4% higher than the average).

Midsize organizations (revenue $50M-$499M) have the highest number of roles with 4.4 (12% higher than the average). This occurs with the introduction of the specialized roles. These are account management (16.9% higher than the average) and renewals (19.2% higher than the average).

Small organizations (revenue <$50M) have the highest percentage of inside sales reps (47%). However, they leverage the outbound sales development role more than any other size of company. A majority of small companies (67.1%) say they use this role.

Download the State of Sales 2017

The State of Sales report was built in partnership with the American Association of Inside Sales Professionals (AA-ISP), Top Sales World, and the Association of Professional Sales (APS).

The benchmarks shows you how you compare to top players in the industry and how you can up your game to be one of the best.

To download an executive summary of the report, click below: